UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported)
October 21, 2014
VIEWPOINT FINANCIAL GROUP, INC.
(Exact name of registrant as specified in its charter)
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Maryland | | 001-34737 | | 27-2176993 |
(State or other Jurisdiction of Incorporation) | | (Commission File No.) | | (I.R.S. Employer Identification No.) |
1309 W. 15th Street, Plano, Texas | | | | 75075 |
(Address of principal executive offices) | | | | (Zip Code) |
Registrant’s telephone number, including area code: (972) 578-5000
N/A
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions: |
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x | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
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o | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
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o | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
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o | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
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ITEM 2.02 | Results of Operations and Financial Condition |
On October 21, 2014, the Registrant announced third quarter 2014 earnings. The press release is attached to this report as Exhibit 99.1, which is incorporated herein by reference.
The information set forth in Item 2.02 above, including the contents of the press release attached as Exhibit 99.1, is incorporated by reference into this Item 8.01.
On October 21, 2014, the Registrant issued a press release announcing the declaration of a quarterly cash dividend of 12 cents per share, payable on November 14, 2014, to stockholders of record as of the close of business on November 3, 2014. The press release is attached to this report as Exhibit 99.2, which is incorporated herein by reference.
On Wednesday, October 22, 2014, at 8:00 a.m. Central Time, the Registrant will host an investor conference call and webcast to review their third quarter 2014 financial results. The webcast will include a slide presentation which consists of information regarding the Registrant's operating and growth strategies and financial performance. The presentation materials will be posted on the Registrant's website on October 21, 2014. The presentation materials are attached hereto as Exhibit 99.3, which is incorporated herein by reference.
In connection with the proposed merger between the Registrant and LegacyTexas Group, Inc. (“LegacyTexas”), the Registrant has filed with the SEC a registration statement on Form S-4, which was declared effective by the SEC on April 9, 2014. The registration statement includes a proxy statement/prospectus, which was mailed in definitive form to the shareholders of LegacyTexas on April 15, 2014. INVESTORS ARE URGED TO READ THE PROXY STATEMENT/PROSPECTUS AND ANY OTHER DOCUMENTS FILED WITH THE SEC IN CONNECTION WITH THE MERGER BECAUSE THEY CONTAIN, OR WILL CONTAIN, AS THE CASE MAY BE, IMPORTANT INFORMATION ABOUT LEGACYTEXAS, THE REGISTRANT AND THE PROPOSED TRANSACTION. Copies of these documents may be obtained free of charge at the SEC’s website (www.sec.gov). In addition, documents filed with the SEC by the Registrant are available free of charge by accessing the Registrant’s website (www.viewpointfinancialgroup.com, under “SEC Filings”) or by contacting Casey Farrell at (972) 801-5871.
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ITEM 9.01 | Financial Statements and Exhibits |
(d) | Exhibits |
Exhibit 99.1 | Press release announcing third quarter 2014 earnings dated October 21, 2014 |
Exhibit 99.2 | Press release announcing quarterly dividend dated October 21, 2014 |
Exhibit 99.3 | Presentation materials |
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned hereunto duly authorized.
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| | | VIEWPOINT FINANCIAL GROUP, INC. |
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Date: | October 21, 2014 | By: | /s/ Kari J. Anderson |
| | | Kari J. Anderson, Chief Accounting Officer and Interim Principal Financial Officer |
EXHIBIT INDEX
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Exhibit No. | Description |
Exhibit 99.1 | Press release announcing third quarter 2014 earnings dated October 21, 2014 |
Exhibit 99.2 | Press release announcing quarterly dividend dated October 21, 2014 |
Exhibit 99.3 | Presentation materials |
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FOR IMMEDIATE RELEASE
October 21, 2014
Contact: Investor Inquiries:
Casey Farrell, ViewPoint Financial Group, Inc.
972-801-5871/shareholderrelations@viewpointfinancialgroup.com
Media Inquiries:
Mary Rische, ViewPoint Bank
972-509-2020 Ex. 7331/mary.rische@viewpointbank.com
ViewPoint Financial Group, Inc. Reports Third Quarter 2014 Earnings
Continued Strong Commercial Loan Growth;
Net Income Up 6% Over Prior Quarter, Up 13% Over Prior Year
PLANO, Texas, October 21, 2014 -- ViewPoint Financial Group, Inc. (NASDAQ: VPFG) (the “Company”), the holding company for ViewPoint Bank, N.A. (the “Bank”), today announced net income of $9.3 million for the quarter ended September 30, 2014, an increase of $494,000, or 5.6%, from the quarter ended June 30, 2014. Compared to the third quarter of 2013, net income increased by $1.1 million, or 13.4%. Basic earnings per share for the quarter ended September 30, 2014, was $0.24, up $0.01 from the linked quarter and up $0.02 from the quarter ended September 30, 2013. Core basic earnings per share for the quarter ended September 30, 2014, was $0.26, unchanged from the linked quarter and up $0.04 from the quarter ended September 30, 2013. Please see the table labeled "Supplemental Information- Non-GAAP Financial Measures" at the end of this document to find a reconciliation of earnings per share calculated per generally accepted accounting principles ("GAAP") to core (non-GAAP) earnings per share.
Previously, the Company announced that it had entered into a definitive agreement under which LegacyTexas Group, Inc. ("LegacyTexas") will merge into the Company. The merger was approved by LegacyTexas' shareholders and will result in one of the largest independent banks in the state of Texas, with 51 branches and pro forma assets of over $5 billion. On August 29, 2014, the Company and LegacyTexas announced that additional time was needed to obtain regulatory approvals and have extended the merger agreement to December 31, 2014.
Third Quarter 2014 Performance Highlights
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• | Loans held for investment, excluding Warehouse Purchase Program loans, grew $139.6 million, or 5.9%, from June 30, 2014, with commercial loans increasing by $126.7 million, or 7.0%, to $1.93 billion at September 30, 2014. |
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• | The Warehouse Purchase Program ending balance decreased by $32.9 million, or 4.3%, from June 30, 2014, while the average balance of Warehouse Purchase Program loans increased by $73.2 million, or 12.8%, compared to the linked quarter. |
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• | The $494,000, or 5.6%, increase in net income for the quarter ended September 30, 2014, compared to the linked quarter, was driven by a $2.0 million, or 5.9%, increase in interest income on loans and a $559,000, or 2.4%, decrease in non-interest expense. |
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• | Deposits increased by $60.7 million, or 2.5%, from June 30, 2014, with growth being driven by non-interest-bearing demand deposits. |
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• | Net interest margin for the quarter ended September 30, 2014 was 3.80%, a four basis point increase from the linked quarter and a 17 basis point increase compared to the third quarter of 2013. |
“The bank had another great quarter, with continued commercial loan and deposit growth and a nice improvement in our net interest margin,” said ViewPoint President and CEO Kevin Hanigan. “I’m very pleased with our performance, especially since employees are also busy with merger preparations. While we still await regulatory approval of our upcoming merger with LegacyTexas, our commitment to and excitement about our partnership doesn’t waver.”
Financial Highlights
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| | | | | | | | | | | |
| At or For the Quarters Ended |
| September | | June | | September |
(unaudited) | 2014 | | 2014 | | 2013 |
| (Dollars in thousands, except per share amounts) |
Net interest income | $ | 34,670 |
| | $ | 32,922 |
| | $ | 29,188 |
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Provision (benefit) for loan losses | 2,511 |
| | 1,197 |
| | (158 | ) |
Non-interest income | 5,058 |
| | 5,429 |
| | 5,226 |
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Non-interest expense | 22,791 |
| | 23,350 |
| | 22,173 |
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Income tax expense | 5,114 |
| | 4,986 |
| | 4,187 |
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Net income | $ | 9,312 |
| | $ | 8,818 |
| | $ | 8,212 |
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Basic earnings per common share | $ | 0.24 |
| | $ | 0.23 |
| | $ | 0.22 |
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Weighted average common shares outstanding - basic | 37,971,790 |
| | 37,873,671 |
| | 37,594,701 |
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Estimated Tier 1 risk-based capital ratio1 | 16.04 | % | | 16.42 | % | | 19.17 | % |
Tangible common equity to tangible assets - Non-GAAP 2 | 13.61 | % | | 13.44 | % | | 15.18 | % |
1 Calculated at the ViewPoint Financial Group, Inc. level, which is subject to the capital adequacy requirements of the Federal Reserve.
2 See the section labeled "Supplemental Information- Non-GAAP Financial Measures" at the end of this document.
Net Interest Income and Net Interest Margin
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| For the Quarters Ended |
| September | | June | | September |
(unaudited) | 2014 | | 2014 | | 2013 |
| (Dollars in thousands) |
Interest income: | | | | | |
Loans held for investment, excluding Warehouse Purchase Program loans | $ | 30,134 |
| | $ | 28,794 |
| | $ | 24,188 |
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Warehouse Purchase Program loans | 5,738 |
| | 5,094 |
| | 6,617 |
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Securities | 2,926 |
| | 3,150 |
| | 3,038 |
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Interest-earning deposit accounts | 57 |
| | 71 |
| | 32 |
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Total interest income | $ | 38,855 |
| | $ | 37,109 |
| | $ | 33,875 |
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Net interest income | $ | 34,670 |
| | 32,922 |
| | $ | 29,188 |
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Net interest margin | 3.80 | % | | 3.76 | % | | 3.63 | % |
Selected average balances: | | | | | |
Total earning assets | $ | 3,652,243 |
| | $ | 3,499,223 |
| | $ | 3,212,156 |
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Total loans | $ | 3,029,047 |
| | $ | 2,834,750 |
| | $ | 2,517,255 |
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Total securities | $ | 532,950 |
| | $ | 545,944 |
| | $ | 640,041 |
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Total deposits | $ | 2,469,482 |
| | $ | 2,386,307 |
| | $ | 2,204,371 |
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Total borrowings | $ | 733,615 |
| | $ | 678,817 |
| | $ | 587,651 |
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Total non-interest-bearing demand deposits | $ | 456,115 |
| | $ | 414,746 |
| | $ | 405,344 |
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Total interest-bearing liabilities | $ | 2,746,982 |
| | $ | 2,650,378 |
| | $ | 2,386,678 |
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Net interest income for the quarter ended September 30, 2014 was $34.7 million, a $1.7 million increase from the second quarter of 2014 and a $5.5 million increase from the third quarter of 2013. The $1.7 million increase from the linked quarter was primarily due to a $2.0 million, or 5.9%, increase in interest income on loans, which was driven by increased volume in commercial and Warehouse Purchase Program loans. The average balance of commercial and industrial loans increased by $72.2 million, or 12.2%, to $662.5 million from the second quarter of 2014, resulting in a $755,000 increase in interest income. Additionally, the average balance of Warehouse Purchase Program loans increased by $73.2 million, or 12.8%, from the linked quarter, contributing $644,000 of the increase in loan interest income. Increases of $33.3 million and $18.5 million in the average balances of consumer real estate and commercial real estate, respectively, also contributed to the increase in interest income on a linked-quarter basis.
For the second quarter in a row, interest expense for the quarter ended September 30, 2014 remained relatively flat compared to the linked quarter, decreasing by $2,000, or 0.05%. A $74,000 linked quarter increase in interest expense related to savings and money market accounts (primarily caused by new deposits from other financial institutions) was partially offset by a $67,000 decrease in interest expense related to time deposits, primarily due to a four basis point decrease in the average rate paid on time deposits.
The $5.5 million increase in net interest income compared to the third quarter of 2013 was primarily due to a $5.1 million, or 16.4%, increase in interest income on loans, which was driven by higher commercial loan volume. For the quarter ended September 30, 2014, the average balance of commercial and industrial loans increased by $324.9 million, or 96.2%, compared to the quarter ended September 30, 2013, which resulted in a $3.2 million increase in interest income. Additionally, the average balance of commercial real estate loans increased by $180.5 million, or 17.9%, for the quarter ended September 30, 2014, compared to the same period in 2013, contributing $2.4 million of the increase in loan interest income. The increases in loan interest income related to commercial loan volume were partially offset by a $40.7 million, or 5.9%, decrease in the average balance of Warehouse Purchase Program loans for the quarter ended September 30, 2014, compared to the same period in 2013, as well as reductions in yields on all loan portfolios.
Compared to the 2013 third quarter, interest expense for the quarter ended September 30, 2014, decreased by $502,000, or 10.7%, which was primarily due to a 53 basis point reduction in the average rate paid on time deposits, as well as a 37 basis point decrease in the average rate paid on borrowings. Average balances of all deposit categories and borrowings increased compared to the third quarter of 2013, which partially offset the decline in interest expense related to lower rates.
The net interest margin for the third quarter of 2014 was 3.80%, a four basis point increase from the second quarter of 2014 and a 17 basis point increase from the third quarter of 2013. Accretion of interest related to the 2012 Highlands acquisition contributed three basis points to the net interest margin for the quarter ended September 30, 2014, compared to four basis points for the quarter ended June 30, 2014, and seven basis points for the quarter ended September 30, 2013. The 17 basis point increase in the net interest margin compared to the third quarter of 2013 included $377,000 of interest income reversed in September 2013 on three non-performing commercial real estate loans that were sold at par in the same month. The average yield on earning assets for the third quarter of 2014 was 4.26%, a two basis point increase from the second quarter of 2014 and a four basis point increase from the third quarter of 2013. The cost of deposits for the third quarter of 2014 was 0.33%, a one basis point decrease from the second quarter of 2014 and an 11 basis point decrease from the third quarter of 2013.
Non-interest Income
Non-interest income for the 2014 third quarter was $5.1 million, a $371,000, or 6.8%, decrease from the second quarter of 2014 and a $168,000, or 3.2%, decrease from the 2013 third quarter. The decrease from the linked quarter was primarily due to an $812,000 change in the gain (loss) on sale and disposition of assets, attributable to $777,000 in gains recognized on two purchased credit impaired loans from the Highlands acquisition that were paid in full during the 2014 second quarter, with no comparable gains recognized in the third quarter. Additionally, service charges and fees decreased by $303,000, or 6.2%, compared to the second quarter of 2014, primarily due to a $240,000 decrease in commercial loan syndication and pre-prepayment fees. These decreases in the third quarter of 2014 were partially offset by a net decrease of $610,000 in a community development-oriented private equity fund used for Community Reinvestment Act purposes recognized in the second quarter of 2014 that was not repeated in the third quarter of 2014.
The $168,000 decrease in non-interest income from the third quarter of 2013 was primarily due to a $126,000 change in the gain (loss) on sale and disposition of assets, which was primarily attributable to $85,000 in write-downs on other real estate owned during the third quarter of 2014, compared to a $38,000 gain on other real estate owned during the third quarter of 2013.
Non-interest Expenses
Non-interest expense for the quarter ended September 30, 2014 was $22.8 million, a $559,000, or 2.4%, decrease from the second quarter of 2014, and a $618,000, or 2.8%, increase from the third quarter of 2013. The linked-quarter decrease was driven by a $466,000, or 3.3%, decrease in salaries and employee benefits expense. In the second quarter of 2014, the Company adjusted its performance-based incentive accrual for the first six months of 2014 based on increased loan production. For the third quarter of 2014, the year-to-date performance-based incentive accrual remained unchanged from the higher second quarter level, as loan production remained high. Additionally, a reduction in health care costs and lower share-based compensation expense resulting from a decline in the Company's stock price also led to the decrease in salaries and employee benefits expense from the linked quarter. Other non-interest expense decreased by $360,000, or 21.7%, from the second quarter of 2014 due to a one-time payment in the second quarter to two directors who retired in May 2014. These declines, as well as a $231,000 reduction in advertising expense and a $151,000 decline in office operations expense, were partially offset by a $536,000 increase in merger and acquisition costs related to the pending merger with LegacyTexas.
The $618,000 increase from the third quarter of 2013 was primarily attributable to $1.2 million in merger and acquisition costs related to the pending merger with LegacyTexas, with no comparable costs recognized during the 2013 third quarter. Additionally, salaries and employee benefits expense increased by $115,000 compared to the third quarter of 2013, primarily due to increased performance-based incentive accruals due to higher loan production, as well as increased ESOP expense due to a rise in the Company's stock price over the past year. Reductions in advertising, other non-interest expense and outside professional services expense partially offset these increases.
Financial Condition
Gross loans held for investment at September 30, 2014, excluding Warehouse Purchase Program loans, increased by $139.6 million, or 5.9%, from June 30, 2014, and by $555.4 million, or 28.7%, from September 30, 2013, with increased commercial lending driving the loan growth. Commercial real estate loan balances at September 30, 2014 increased by $57.4 million, or 4.9%, from June 30, 2014, and by $184.1 million, or 17.8%, from September 30, 2013. Commercial and industrial loans at September 30, 2014 increased by $84.6 million, or 13.8%, from June 30, 2014, and by $304.8 million, or 78.0%, from September 30, 2013. Warehouse Purchase Program loans at September 30, 2014 decreased by $32.9 million, or 4.3%, from June 30, 2014, but increased by $96.6 million, or 15.1%, from September 30, 2013. Consumer loans at September 30, 2014 increased by $12.6 million, or 2.3%, from June 30, 2014, and by $65.0 million, or 13.2%, from September 30, 2013.
Energy loans, which are reported as commercial and industrial loans, totaled $283.6 million at September 30, 2014, up $61.4 million from $222.2 million at June 30, 2014, and up $169.4 million from September 30, 2013. In May 2013, the Company formed its Energy Finance group, which focuses on providing loans to private and public oil and gas companies throughout the United States. The group also offers the Bank's full array of commercial services, including Treasury Management and letters of credit, to its customers.
Total deposits at September 30, 2014 increased by $60.7 million, or 2.5%, from June 30, 2014, and by $248.5 million, or 11.1%, from September 30, 2013. Over the past year, non-interest-bearing demand deposits have grown by $82.6 million, or 20.6%, and totaled $483.8 million at September 30, 2014, or 19.4% of total deposits. This increase was driven by higher balances in commercial checking products. Savings and money market deposits increased by $25.4 million, or 2.5%, from June 30, 2014, and by $161.6 million, or 18.0%, from September 30, 2013. This growth in savings and money market deposits over the past year included $75.9 million in savings deposits from other financial institutions (a program initiated in the second quarter of 2014), as well as increases in both consumer and commercial savings and money market deposit balances.
Total shareholders' equity increased by $6.7 million to $564.1 million at September 30, 2014, from $557.4 million at June 30, 2014. The Company's tangible common equity ratio was 13.61% at September 30, 2014, an increase of 17 basis points from June 30, 2014, and a decrease of 157 basis points from September 30, 2013.
Credit Quality |
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| At or For the Quarters Ended |
| September | | June | | September |
(unaudited) | 2014 | | 2014 | | 2013 |
| (Dollars in thousands) |
Net charge-offs | $ | 366 |
| | $ | 159 |
| | $ | 250 |
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Net charge-offs/Average loans held for investment, excluding Warehouse Purchase Program loans | 0.06 | % | | 0.03 | % | | 0.05 | % |
Net charge-offs/Average loans held for investment | 0.05 |
| | 0.02 |
| | 0.04 |
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Provision (benefit) for loan losses | $ | 2,511 |
| | $ | 1,197 |
| | $ | (158 | ) |
Non-performing loans ("NPLs") | 24,382 |
| | 23,605 |
| | 22,307 |
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NPLs/Total loans held for investment, excluding Warehouse Purchase Program loans | 0.98 | % | | 1.00 | % | | 1.15 | % |
NPLs/Total loans held for investment | 0.76 |
| | 0.76 |
| | 0.87 |
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Non-performing assets ("NPAs") | $ | 24,488 |
| | $ | 23,845 |
| | $ | 22,735 |
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NPAs to total assets | 0.62 | % | | 0.60 | % | | 0.67 | % |
NPAs/Loans held for investment and foreclosed assets, excluding Warehouse Purchase Program loans | 0.98 |
| | 1.01 |
| | 1.18 |
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NPAs/Loans held for investment and foreclosed assets | 0.76 |
| | 0.76 |
| | 0.88 |
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Allowance for loan losses | $ | 22,585 |
| | $ | 20,440 |
| | 18,869 |
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Allowance for loan losses/Total loans held for investment, excluding Warehouse Purchase Program loans | 0.91 | % | | 0.87 | % | | 0.98 | % |
Allowance for loan losses/Total loans held for investment | 0.70 |
| | 0.66 |
| | 0.73 |
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Allowance for loan losses/Total Loans held for investment, excluding acquired loans & Warehouse Purchase Program loans 1 | 0.94 |
| | 0.90 |
| | 1.05 |
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Allowance for loan losses/NPLs | 92.63 |
| | 86.59 |
| | 84.59 |
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1 Excludes loans acquired in 2012 from Highlands, which were initially recorded at fair value.
The Company recorded a provision for loan losses of $2.5 million for the quarter ended September 30, 2014, compared to provision expense of $1.2 million for the quarter ended June 30, 2014, and a benefit of $158,000 for the quarter ended September 30, 2013. The increase in the provision for loan losses on a linked quarter basis, as well as compared to the quarter ended September 30, 2013, was primarily related to increased commercial loan production, as commercial balances increased by $126.7 million compared to June 30, 2014, and by $489.0 million from September 30, 2013.
Subsequent Events
The Company is required under generally accepted accounting principles to evaluate subsequent events through the filing of its consolidated financial statements for the quarter ended September 30, 2014, on Form 10-Q. As a result, the Company will continue to evaluate the impact of any subsequent events on critical accounting assumptions and estimates made as of September 30, 2014, and will adjust amounts preliminarily reported, if necessary.
Conference Call
The Company will host an investor conference call to review the results on Wednesday, October 22, 2014, at 8 a.m. Central Time. Participants may pre-register for the call by visiting http://dpregister.com/10052080 and will receive a unique pin number, which can be used when dialing in for the call. This will allow attendees to enter the call immediately. Alternatively, participants may call (toll-free) 1-877-513-4119 at least five minutes prior to the call to be placed into the call by an operator. International participants are asked to call 1-412-902-4148 and participants in Canada are asked to call (toll-free) 1-855-669-9657.
The call and corresponding presentation slides will be webcast live on the home page of the Company's website, www.viewpointfinancialgroup.com. An audio replay will be available one hour after the conclusion of the call at 1-877-344-7529, Conference #10052080. This replay, as well as the webcast, will be available until November 12, 2014.
About ViewPoint Financial Group, Inc.
ViewPoint Financial Group, Inc. is the holding company for ViewPoint Bank, N.A. ViewPoint Bank, N.A. operates 31 banking offices in the Dallas/Fort Worth metropolitan area, including two First National Bank of Jacksboro locations in Jack and Wise Counties. For more information, please visit www.viewpointbank.com or www.viewpointfinancialgroup.com.
When used in filings by ViewPoint Financial Group, Inc. (“ViewPoint”) with the Securities and Exchange Commission (the “SEC”), in ViewPoint’s press releases or other public or shareholder communications, and in oral statements made with the approval of an authorized executive officer, the words or phrases “will likely result,” “are expected to,” “will continue,” “is anticipated,” “estimate,” “project,” “intends” or similar expressions are intended to identify “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements are subject to certain risks and uncertainties that could cause actual results to differ materially from historical earnings and those presently anticipated or projected, including, among other things: the expected cost savings, synergies and other financial benefits from the ViewPoint-LegacyTexas merger (the “Merger”) might not be realized within the expected time frames or at all and costs or difficulties relating to integration matters might be greater than expected; the requisite regulatory approvals might not be obtained or other conditions to completion of the merger set forth in the merger agreement might not be satisfied or waived; changes in economic conditions; legislative changes; changes in policies by regulatory agencies; fluctuations in interest rates; the risks of lending and investing activities, including changes in the level and direction of loan delinquencies and write-offs and changes in estimates of the adequacy of the allowance for loan losses; ViewPoint’s ability to access cost-effective funding; fluctuations in real estate values and both residential and commercial real estate market conditions; demand for loans and deposits in ViewPoint’s market area; the industry-wide decline in mortgage production; competition; changes in management’s business strategies and other factors set forth in ViewPoint’s filings with the SEC.
ViewPoint does not undertake - and specifically declines any obligation - to publicly release the result of any revisions which may be made to any forward-looking statements to reflect events or circumstances after the date of such statements or to reflect the occurrence of anticipated or unanticipated events.
This communication does not constitute an offer to sell or the solicitation of an offer to buy any securities or a solicitation of any vote or approval. ViewPoint has filed with the SEC a registration statement on Form S-4, which was declared effective by the SEC on April 9, 2014. The registration statement includes a proxy statement/prospectus, which was mailed in definitive form to the shareholders of LegacyTexas on April 15, 2014. INVESTORS ARE URGED TO READ THE PROXY STATEMENT/PROSPECTUS AND ANY OTHER DOCUMENTS FILED WITH THE SEC IN CONNECTION WITH THE MERGER BECAUSE THEY CONTAIN, OR WILL CONTAIN, IMPORTANT INFORMATION ABOUT LEGACYTEXAS, VIEWPOINT AND THE MERGER. Investors may obtain these documents free of charge at the SEC’s website (www.sec.gov). In addition, documents filed with the SEC by ViewPoint are available free of charge by accessing ViewPoint’s website (www.viewpointfinancialgroup.com, under “SEC Filings”) or by contacting Casey Farrell at (972) 801-5871.
VIEWPOINT FINANCIAL GROUP, INC.
Consolidated Balance Sheets |
| | | | | | | | | | | | | | | | | | | |
| September 30, 2014 | | June 30, 2014 | | March 31, 2014 | | December 31, 2013 | | September 30, 2013 |
| (Dollars in thousands) |
ASSETS | (unaudited) | | (unaudited) | | (unaudited) | | | | (unaudited) |
Cash and due from financial institutions | $ | 27,669 |
| | $ | 35,276 |
| | $ | 33,627 |
| | $ | 30,012 |
| | $ | 33,803 |
|
Short-term interest-bearing deposits in other financial institutions | 62,616 |
| | 130,632 |
| | 88,238 |
| | 57,962 |
| | 40,223 |
|
Total cash and cash equivalents | 90,285 |
| | 165,908 |
| | 121,865 |
| | 87,974 |
|
| 74,026 |
|
Securities available for sale, at fair value | 211,364 |
| | 224,184 |
| | 236,062 |
| | 248,012 |
| | 264,657 |
|
Securities held to maturity | 254,665 |
| | 267,614 |
| | 280,490 |
| | 294,583 |
| | 307,822 |
|
Total securities | 466,029 |
| | 491,798 |
| | 516,552 |
| | 542,595 |
| | 572,479 |
|
Loans held for investment: | | | | | | | | | |
Loans held for investment - Warehouse Purchase Program | 736,624 |
| | 769,566 |
| | 590,904 |
| | 673,470 |
| | 640,028 |
|
Loans held for investment | 2,489,063 |
| | 2,349,509 |
| | 2,207,580 |
| | 2,049,902 |
| | 1,933,669 |
|
Gross loans | 3,225,687 |
| | 3,119,075 |
| | 2,798,484 |
| | 2,723,372 |
| | 2,573,697 |
|
Less: allowance for loan losses and deferred fees on loans held for investment | (24,773 | ) | | (22,139 | ) | | (21,291 | ) | | (20,625 | ) | | (19,513 | ) |
Net loans | 3,200,914 |
| | 3,096,936 |
| | 2,777,193 |
| | 2,702,747 |
| | 2,554,184 |
|
FHLB and Federal Reserve Bank stock, at cost | 41,473 |
| | 44,532 |
| | 33,632 |
| | 34,883 |
| | 29,632 |
|
Bank-owned life insurance | 36,010 |
| | 35,863 |
| | 35,718 |
| | 35,565 |
| | 35,379 |
|
Premises and equipment, net | 51,118 |
| | 51,955 |
| | 52,736 |
| | 53,272 |
| | 52,729 |
|
Goodwill | 29,650 |
| | 29,650 |
| | 29,650 |
| | 29,650 |
| | 29,650 |
|
Other assets | 35,045 |
| | 34,602 |
| | 36,242 |
| | 38,546 |
| | 35,528 |
|
Total assets | $ | 3,950,524 |
| | $ | 3,951,244 |
| | $ | 3,603,588 |
| | $ | 3,525,232 |
| | $ | 3,383,607 |
|
| | | | | | | | | |
LIABILITIES AND SHAREHOLDERS’ EQUITY | | | | | | |
Non-interest-bearing demand | $ | 483,784 |
| | $ | 433,194 |
| | $ | 434,463 |
| | $ | 410,933 |
| | $ | 401,136 |
|
Interest-bearing demand | 454,416 |
| | 476,203 |
| | 479,432 |
| | 474,515 |
| | 451,248 |
|
Savings and money market | 1,057,912 |
| | 1,032,496 |
| | 945,046 |
| | 904,576 |
| | 896,330 |
|
Time | 500,356 |
| | 493,833 |
| | 510,305 |
| | 474,615 |
| | 499,228 |
|
Total deposits | 2,496,468 |
| | 2,435,726 |
| | 2,369,246 |
| | 2,264,639 |
| | 2,247,942 |
|
FHLB advances | 799,704 |
| | 874,866 |
| | 607,996 |
| | 639,096 |
| | 511,166 |
|
Repurchase agreement and other borrowings | 25,000 |
| | 25,000 |
| | 25,000 |
| | 25,000 |
| | 25,000 |
|
Accrued expenses and other liabilities | 65,225 |
| | 58,240 |
| | 51,247 |
| | 52,037 |
| | 59,410 |
|
Total liabilities | 3,386,397 |
| | 3,393,832 |
| | 3,053,489 |
| | 2,980,772 |
| | 2,843,518 |
|
| | | | | | | | | |
Shareholders’ equity | |
| | | | |
| | |
| | |
|
Common stock | 400 |
| | 400 |
| | 399 |
| | 399 |
| | 400 |
|
Additional paid-in capital | 383,779 |
| | 381,808 |
| | 379,578 |
| | 377,657 |
| | 375,563 |
|
Retained earnings | 194,663 |
| | 190,150 |
| | 186,126 |
| | 183,236 |
| | 180,787 |
|
Accumulated other comprehensive income (loss), net | 635 |
| | 770 |
| | 78 |
| | (383 | ) | | 155 |
|
Unearned Employee Stock Ownership Plan (ESOP) shares | (15,350 | ) | | (15,716 | ) | | (16,082 | ) | | (16,449 | ) | | (16,816 | ) |
Total shareholders’ equity | 564,127 |
| | 557,412 |
| | 550,099 |
| | 544,460 |
| | 540,089 |
|
Total liabilities and shareholders’ equity | $ | 3,950,524 |
| | $ | 3,951,244 |
| | $ | 3,603,588 |
| | $ | 3,525,232 |
| | $ | 3,383,607 |
|
VIEWPOINT FINANCIAL GROUP, INC.
Consolidated Quarterly Statements of Income (unaudited) |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| For the Quarters Ended | | Third Quarter 2014 Compared to: |
| Sep 30, 2014 | | Jun 30, 2014 | | Mar 31, 2014 | | Dec 31, 2013 | | Sep 30, 2013 | | Second Quarter 2014 | | Third Quarter 2013 |
Interest and dividend income | (Dollars in thousands) |
Loans, including fees | $ | 35,872 |
| | $ | 33,888 |
| | $ | 30,388 |
| | $ | 31,188 |
| | $ | 30,805 |
| | $ | 1,984 |
| 5.9 | % | | $ | 5,067 |
| 16.4 | % |
Taxable securities | 2,225 |
| | 2,453 |
| | 2,565 |
| | 2,583 |
| | 2,337 |
| | (228 | ) | (9.3 | ) | | (112 | ) | (4.8 | ) |
Nontaxable securities | 562 |
| | 561 |
| | 564 |
| | 562 |
| | 568 |
| | 1 |
| 0.2 |
| | (6 | ) | (1.1 | ) |
Interest-bearing deposits in other financial institutions | 57 |
| | 71 |
| | 57 |
| | 38 |
| | 32 |
| | (14 | ) | (19.7 | ) | | 25 |
| 78.1 |
|
FHLB and Federal Reserve Bank stock | 139 |
| | 136 |
| | 130 |
| | 128 |
| | 133 |
| | 3 |
| 2.2 |
| | 6 |
| 4.5 |
|
| 38,855 |
| | 37,109 |
| | 33,704 |
| | 34,499 |
| | 33,875 |
| | 1,746 |
| 4.7 |
| | 4,980 |
| 14.7 |
|
Interest expense | | | | | | | | | | | | | |
|
|
|
|
Deposits | 2,021 |
| | 2,035 |
| | 1,991 |
| | 2,252 |
| | 2,411 |
| | (14 | ) | (0.7 | ) | | (390 | ) | (16.2 | ) |
FHLB advances | 1,957 |
| | 1,948 |
| | 1,927 |
| | 1,971 |
| | 2,066 |
| | 9 |
| 0.5 |
| | (109 | ) | (5.3 | ) |
Repurchase agreement | 205 |
| | 204 |
| | 201 |
| | 206 |
| | 206 |
| | 1 |
| 0.5 |
| | (1 | ) | (0.5 | ) |
Other borrowings | 2 |
| | — |
| | — |
| | 1 |
| | 4 |
| | 2 |
| N/M 1 | | (2 | ) | (50.0 | ) |
| 4,185 |
| | 4,187 |
| | 4,119 |
| | 4,430 |
| | 4,687 |
| | (2 | ) | — |
| | (502 | ) | (10.7 | ) |
Net interest income | 34,670 |
| | 32,922 |
| | 29,585 |
| | 30,069 |
| | 29,188 |
| | 1,748 |
| 5.3 |
| | 5,482 |
| 18.8 |
|
Provision (benefit) for loan losses | 2,511 |
| | 1,197 |
| | 376 |
| | 616 |
| | (158 | ) | | 1,314 |
| 109.8 |
| | 2,669 |
| N/M 1 |
Net interest income after provision (benefit) for loan losses | 32,159 |
| | 31,725 |
| | 29,209 |
| | 29,453 |
| | 29,346 |
| | 434 |
| 1.4 |
| | 2,813 |
| 9.6 |
|
Non-interest income | | | | | | | | | | | | | | | |
Service charges and fees | 4,571 |
| | 4,874 |
| | 4,298 |
| | 4,259 |
| | 4,460 |
| | (303 | ) | (6.2 | ) | | 111 |
| 2.5 |
|
Other charges and fees | 227 |
| | 239 |
| | 210 |
| | 246 |
| | 300 |
| | (12 | ) | (5.0 | ) | | (73 | ) | (24.3 | ) |
Bank-owned life insurance income | 147 |
| | 145 |
| | 153 |
| | 186 |
| | 148 |
| | 2 |
| 1.4 |
| | (1 | ) | (0.7 | ) |
Gain (loss) on sale and disposition of assets | (85 | ) | | 727 |
| | 1 |
| | 120 |
| | 41 |
| | (812 | ) | N/M 1 | | (126 | ) | N/M 1 |
Other | 198 |
| | (556 | ) | | 300 |
| | 194 |
| | 277 |
| | 754 |
| N/M 1 | | (79 | ) | (28.5 | ) |
| 5,058 |
| | 5,429 |
| | 4,962 |
| | 5,005 |
| | 5,226 |
| | (371 | ) | (6.8 | ) | | (168 | ) | (3.2 | ) |
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Non-interest expense | | | | | | | | | | | | | | | |
Salaries and employee benefits | 13,661 |
| | 14,127 |
| | 14,132 |
| | 14,339 |
| | 13,546 |
| | (466 | ) | (3.3 | ) | | 115 |
| 0.8 |
|
Merger and acquisition costs | 1,188 |
| | 652 |
| | 169 |
| | 663 |
| | — |
| | 536 |
| 82.2 |
| | 1,188 |
| N/M 1 |
Advertising | 262 |
| | 493 |
| | 355 |
| | 760 |
| | 666 |
| | (231 | ) | (46.9 | ) | | (404 | ) | (60.7 | ) |
Occupancy and equipment | 1,807 |
| | 1,819 |
| | 1,892 |
| | 2,117 |
| | 1,830 |
| | (12 | ) | (0.7 | ) | | (23 | ) | (1.3 | ) |
Outside professional services | 569 |
| | 486 |
| | 525 |
| | 824 |
| | 682 |
| | 83 |
| 17.1 |
| | (113 | ) | (16.6 | ) |
Regulatory assessments | 698 |
| | 687 |
| | 628 |
| | 619 |
| | 629 |
| | 11 |
| 1.6 |
| | 69 |
| 11.0 |
|
Data processing | 1,739 |
| | 1,708 |
| | 1,662 |
| | 1,747 |
| | 1,733 |
| | 31 |
| 1.8 |
| | 6 |
| 0.3 |
|
Office operations | 1,566 |
| | 1,717 |
| | 1,680 |
| | 1,781 |
| | 1,603 |
| | (151 | ) | (8.8 | ) | | (37 | ) | (2.3 | ) |
Other | 1,301 |
| | 1,661 |
| | 1,112 |
| | 1,278 |
| | 1,484 |
| | (360 | ) | (21.7 | ) | | (183 | ) | (12.3 | ) |
| 22,791 |
| | 23,350 |
| | 22,155 |
| | 24,128 |
| | 22,173 |
| | (559 | ) | (2.4 | ) | | 618 |
| 2.8 |
|
Income before income tax expense | 14,426 |
| | 13,804 |
| | 12,016 |
| | 10,330 |
| | 12,399 |
| | 622 |
| 4.5 |
| | 2,027 |
| 16.3 |
|
Income tax expense | 5,114 |
| | 4,986 |
| | 4,334 |
| | 3,086 |
| | 4,187 |
| | 128 |
| 2.6 |
| | 927 |
| 22.1 |
|
Net income | $ | 9,312 |
| | $ | 8,818 |
| | $ | 7,682 |
| | $ | 7,244 |
| | $ | 8,212 |
| | $ | 494 |
| 5.6 | % | | $ | 1,100 |
| 13.4 | % |
1 N/M - not meaningful
VIEWPOINT FINANCIAL GROUP, INC.
Selected Financial Highlights (unaudited) |
| | | | | | | | | | | |
| At or For the Quarters Ended |
| September 30, | | June 30, | | September 30, |
| 2014 | | 2014 | | 2013 |
| (Dollars in thousands, except per share amounts) |
SHARE DATA: | | | | | |
Weighted average common shares outstanding- basic | 37,971,790 |
| | 37,873,671 |
| | 37,594,701 |
|
Weighted average common shares outstanding- diluted | 38,203,508 |
| | 38,121,374 |
| | 37,774,400 |
|
Shares outstanding at end of period | 40,006,941 |
| | 39,995,720 |
| | 39,951,884 |
|
Income available to common shareholders1 | $ | 9,215 |
| | $ | 8,721 |
| | $ | 8,096 |
|
Basic earnings per common share | 0.24 |
| | 0.23 |
| | 0.22 |
|
Basic core (non-GAAP) earnings per common share2 | 0.26 |
| | 0.26 |
| | 0.22 |
|
Diluted earnings per common share | 0.24 |
| | 0.23 |
| | 0.21 |
|
Dividends declared per share | 0.12 |
| | 0.12 |
| | 0.10 |
|
Total shareholders' equity | 564,127 |
| | 557,412 |
| | 540,089 |
|
Common shareholders' equity per share (book value per share) | 14.10 |
| | 13.94 |
| | 13.52 |
|
Tangible book value per share- Non-GAAP2 | 13.34 |
| | 13.17 |
| | 12.74 |
|
Market value per share for the quarter: | | | | | |
High | 27.52 |
| | 29.34 |
| | 22.34 |
|
Low | 23.94 |
| | 23.95 |
| | 19.62 |
|
Close | 23.94 |
| | 26.91 |
| | 20.67 |
|
KEY RATIOS: | | | | | |
Return on average common shareholders' equity | 6.63 | % | | 6.36 | % | | 6.11 | % |
Return on average assets | 0.97 |
| | 0.96 |
| | 0.97 |
|
Efficiency ratio3 | 54.17 |
| | 59.11 |
| | 64.28 |
|
Estimated Tier 1 risk-based capital ratio4 | 16.04 |
| | 16.42 |
| | 19.17 |
|
Estimated total risk-based capital ratio4 | 16.72 |
| | 17.06 |
| | 19.88 |
|
Estimated Tier 1 leverage ratio4 | 14.03 |
| | 14.43 |
| | 15.17 |
|
Tangible equity to tangible assets- Non-GAAP2 | 13.61 |
| | 13.44 |
| | 15.18 |
|
Number of employees- full-time equivalent | 512 |
| | 523 |
| | 561 |
|
1 Net of distributed and undistributed earnings to participating securities
2 See the section labeled "Supplemental Information- Non-GAAP Financial Measures" at the end of this document.
3 Calculated by dividing total non-interest expense by net interest income plus non-interest income, excluding gain (loss) on foreclosed assets, amortization of intangible assets, gains (losses) from securities transactions, merger and acquisition costs and other non-recurring items.
4 Calculated at the ViewPoint Financial Group, Inc. level, which is subject to the capital adequacy requirements of the Federal Reserve.
VIEWPOINT FINANCIAL GROUP, INC.
Selected Loan Data (unaudited)
|
| | | | | | | | | | | | | | | | | | | |
| At the Quarter Ended |
| September 30, 2014 | | June 30, 2014 | | March 31, 2014 | | December 31, 2013 | | September 30, 2013 |
Loans: | (Dollars in thousands) |
Commercial real estate | $ | 1,219,436 |
| | $ | 1,162,035 |
| | $ | 1,118,059 |
| | $ | 1,091,200 |
| | $ | 1,035,383 |
|
Warehouse Purchase Program loans | 736,624 |
| | 769,566 |
| | 590,904 |
| | 673,470 |
| | 640,028 |
|
Commercial and industrial loans: | | | | | | | | | |
Commercial | 668,421 |
| | 579,561 |
| | 517,247 |
| | 425,030 |
| | 373,390 |
|
Warehouse lines of credit | 27,122 |
| | 31,426 |
| | 26,333 |
| | 14,400 |
| | 17,356 |
|
Total commercial and industrial loans | 695,543 |
| | 610,987 |
| | 543,580 |
| | 439,430 |
| | 390,746 |
|
Construction and land loans: | | | | | | | | | |
Commercial construction and land | 13,206 |
| | 28,496 |
| | 34,465 |
| | 27,619 |
| | 13,045 |
|
Consumer construction and land | 3,694 |
| | 3,445 |
| | 2,604 |
| | 2,628 |
| | 2,307 |
|
Total construction and land loans | 16,900 |
| | 31,941 |
| | 37,069 |
| | 30,247 |
| | 15,352 |
|
Consumer: | | | | | | | | | |
Consumer real estate | 515,706 |
| | 501,328 |
| | 463,857 |
| | 441,226 |
| | 442,073 |
|
Other consumer loans | 41,478 |
| | 43,218 |
| | 45,015 |
| | 47,799 |
| | 50,115 |
|
Total consumer | 557,184 |
| | 544,546 |
| | 508,872 |
| | 489,025 |
| | 492,188 |
|
Gross loans held for investment | $ | 3,225,687 |
| | $ | 3,119,075 |
| | $ | 2,798,484 |
| | $ | 2,723,372 |
| | $ | 2,573,697 |
|
Non-performing assets: | | | | | | | | | |
Commercial real estate | $ | 7,452 |
| | $ | 7,386 |
| | $ | 8,110 |
| | $ | 7,604 |
| | $ | 7,770 |
|
Commercial and industrial | 6,328 |
| | 6,245 |
| | 5,990 |
| | 5,141 |
| | 5,788 |
|
Construction and land | 150 |
| | 213 |
| | — |
| | — |
| | — |
|
Consumer real estate | 10,106 |
| | 9,304 |
| | 8,203 |
| | 8,812 |
| | 8,237 |
|
Other consumer loans | 346 |
| | 457 |
| | 526 |
| | 567 |
| | 512 |
|
Total non-performing loans | 24,382 |
| | 23,605 |
| | 22,829 |
| | 22,124 |
| | 22,307 |
|
Foreclosed assets | 106 |
| | 240 |
| | 387 |
| | 480 |
| | 428 |
|
Total non-performing assets | $ | 24,488 |
| | $ | 23,845 |
| | $ | 23,216 |
| | $ | 22,604 |
| | $ | 22,735 |
|
Total non-performing assets to total assets | 0.62 | % | | 0.60 | % | | 0.64 | % | | 0.64 | % | | 0.67 | % |
Total non-performing loans to total loans held for investment, excluding Warehouse Purchase Program loans | 0.98 | % | | 1.00 | % | | 1.03 | % | | 1.08 | % | | 1.15 | % |
Total non-performing loans to total loans held for investment | 0.76 | % | | 0.76 | % | | 0.82 | % | | 0.81 | % | | 0.87 | % |
Allowance for loan losses to non-performing loans | 92.63 | % | | 86.59 | % | | 84.99 | % | | 87.50 | % | | 84.59 | % |
Allowance for loan losses to total loans held for investment, excluding Warehouse Purchase Program loans | 0.91 | % | | 0.87 | % | | 0.88 | % | | 0.94 | % | | 0.98 | % |
Allowance for loan losses to total loans held for investment | 0.70 | % | | 0.66 | % | | 0.69 | % | | 0.71 | % | | 0.73 | % |
Allowance for loan losses to total loans held for investment, excluding acquired loans and Warehouse Purchase Program loans 1 | 0.94 | % | | 0.90 | % | | 0.92 | % | | 1.00 | % | | 1.05 | % |
|
| | | | | | | | | | | | | | | | | | | |
Troubled debt restructured loans ("TDRs"): | | | | | | | | | |
Performing TDRs: | | | | | | | | | |
Commercial real estate | $ | 706 |
| | $ | 666 |
| | $ | — |
| | $ | — |
| | $ | — |
|
Commercial and industrial | 158 |
| | 162 |
| | 167 |
| | 185 |
| | 190 |
|
Construction and land | — |
| | — |
| | 2 |
| | 2 |
| | 3 |
|
Consumer real estate | 407 |
| | 729 |
| | 732 |
| | 737 |
| | 741 |
|
Other consumer loans | 41 |
| | 43 |
| | 44 |
| | 47 |
| | 51 |
|
Total performing TDRs | $ | 1,312 |
| | $ | 1,600 |
| | $ | 945 |
| | $ | 971 |
| | $ | 985 |
|
Non-performing TDRs:2 | | | | | | | | | |
Commercial real estate | $ | 6,646 |
| | $ | 6,694 |
| | $ | 7,401 |
| | $ | 7,446 |
| | $ | 7,559 |
|
Commercial and industrial | 2,125 |
| | 2,194 |
| | 2,333 |
| | 349 |
| | 277 |
|
Construction and land | 104 |
| | — |
| | — |
| | — |
| | — |
|
Consumer real estate | 3,606 |
| | 3,199 |
| | 3,024 |
| | 3,070 |
| | 2,690 |
|
Other consumer loans | 300 |
| | 411 |
| | 471 |
| | 503 |
| | 470 |
|
Total non-performing TDRs | $ | 12,781 |
| | $ | 12,498 |
| | $ | 13,229 |
| | $ | 11,368 |
| | $ | 10,996 |
|
Allowance for loan losses: | | | | | | | | | |
Balance at beginning of period | $ | 20,440 |
| | $ | 19,402 |
| | $ | 19,358 |
| | $ | 18,869 |
| | $ | 19,277 |
|
Provision expense (benefit) | 2,511 |
| | 1,197 |
| | 376 |
| | 616 |
| | (158 | ) |
Charge-offs | (493 | ) | | (294 | ) | | (471 | ) | | (255 | ) | | (356 | ) |
Recoveries | 127 |
| | 135 |
| | 139 |
| | 128 |
| | 106 |
|
Balance at end of period | $ | 22,585 |
| | $ | 20,440 |
| | $ | 19,402 |
| | $ | 19,358 |
| | $ | 18,869 |
|
Net charge-offs (recoveries): | | | | | | | | | |
Commercial real estate | $ | — |
| | $ | — |
| | $ | — |
| | $ | — |
| | $ | 34 |
|
Commercial and industrial | 152 |
| | 53 |
| | 192 |
| | 43 |
| | 204 |
|
Construction and land | 50 |
| | — |
| | — |
| | — |
| | — |
|
Consumer real estate | 69 |
| | 54 |
| | 77 |
| | 14 |
| | (18 | ) |
Other consumer loans | 95 |
| | 52 |
| | 63 |
| | 70 |
| | 30 |
|
Total net charge-offs | $ | 366 |
| | $ | 159 |
| | $ | 332 |
| | $ | 127 |
| | $ | 250 |
|
| | | | | | | | | |
1 Excludes loans acquired from Highlands, which were initially recorded at fair value. |
2 Non-performing TDRs are included in the non-performing assets reported above. |
VIEWPOINT FINANCIAL GROUP, INC.
Average Balances and Yields/Rates (unaudited)
|
| | | | | | | | | | | | | | | | | | | |
| For the Quarters Ended |
| September 30, 2014 | | June 30, 2014 | | March 31, 2014 | | December 31, 2013 | | September 30, 2013 |
Loans: | (Dollars in thousands) |
Commercial real estate | $ | 1,187,982 |
| | $ | 1,169,484 |
| | $ | 1,130,304 |
| | $ | 1,077,112 |
| | $ | 1,007,449 |
|
Warehouse Purchase Program loans | 645,148 |
| | 571,922 |
| | 446,935 |
| | 542,367 |
| | 685,852 |
|
Commercial and industrial loans: | | | | | | | | | |
Commercial | 633,208 |
| | 561,026 |
| | 449,867 |
| | 376,557 |
| | 316,506 |
|
Warehouse lines of credit | 29,296 |
| | 29,327 |
| | 17,988 |
| | 15,316 |
| | 21,077 |
|
Consumer real estate | 513,768 |
| | 480,512 |
| | 440,662 |
| | 441,722 |
| | 453,939 |
|
Other consumer loans | 42,308 |
| | 44,162 |
| | 46,453 |
| | 49,202 |
| | 51,414 |
|
Less: deferred fees and allowance for loan loss | (22,663 | ) | | (21,683 | ) | | (20,767 | ) | | (20,002 | ) | | (18,982 | ) |
Loans receivable | 3,029,047 |
| | 2,834,750 |
| | 2,511,442 |
| | 2,482,274 |
| | 2,517,255 |
|
Securities | 532,950 |
| | 545,944 |
| | 562,607 |
| | 592,769 |
| | 640,041 |
|
Overnight deposits | 90,246 |
| | 118,529 |
| | 96,292 |
| | 64,210 |
| | 54,860 |
|
Total interest-earning assets | $ | 3,652,243 |
| | $ | 3,499,223 |
| | $ | 3,170,341 |
| | $ | 3,139,253 |
| | $ | 3,212,156 |
|
Deposits: | | | | | | | | | |
Interest-bearing demand | $ | 460,192 |
| | $ | 468,283 |
| | $ | 460,745 |
| | $ | 455,983 |
| | $ | 448,241 |
|
Savings and money market | 1,060,311 |
| | 1,000,243 |
| | 918,636 |
| | 902,019 |
| | 892,355 |
|
Time | 492,864 |
| | 503,035 |
| | 493,196 |
| | 478,244 |
| | 458,431 |
|
FHLB advances and other borrowings | 733,615 |
| | 678,817 |
| | 464,723 |
| | 468,855 |
| | 587,651 |
|
Total interest-bearing liabilities | $ | 2,746,982 |
| | $ | 2,650,378 |
| | $ | 2,337,300 |
| | $ | 2,305,101 |
| | $ | 2,386,678 |
|
| | | | | | | | | |
Total assets | $ | 3,837,424 |
| | $ | 3,683,042 |
| | $ | 3,354,668 |
| | $ | 3,318,500 |
| | $ | 3,390,837 |
|
Non-interest-bearing demand deposits | $ | 456,115 |
| | $ | 414,746 |
| | $ | 414,919 |
| | $ | 404,087 |
| | $ | 405,344 |
|
Total deposits | $ | 2,469,482 |
| | $ | 2,386,307 |
| | $ | 2,287,496 |
| | $ | 2,240,333 |
| | $ | 2,204,371 |
|
Total shareholders' equity | $ | 562,022 |
| | $ | 554,501 |
| | $ | 547,201 |
| | $ | 542,360 |
| | $ | 537,901 |
|
| | | | | | | | | |
Yields/Rates: | | | | | | | | | |
Loans: | | | | | | | | | |
Commercial real estate | 5.47 | % | | 5.47 | % | | 5.38 | % | | 5.56 | % | | 5.50 | % |
Warehouse Purchase Program loans | 3.56 | % | | 3.56 | % | | 3.64 | % | | 3.79 | % | | 3.86 | % |
Commercial and industrial loans: | | | | | | | | | |
Commercial | 4.21 | % | | 4.21 | % | | 4.24 | % | | 4.92 | % | | 4.45 | % |
Warehouse lines of credit | 3.55 | % | | 3.64 | % | | 3.60 | % | | 3.51 | % | | 3.56 | % |
Consumer real estate | 4.92 | % | | 4.97 | % | | 4.98 | % | | 5.05 | % | | 5.15 | % |
Other consumer loans | 6.03 | % | | 6.07 | % | | 5.95 | % | | 6.07 | % | | 6.19 | % |
Loans receivable | 4.74 | % | | 4.78 | % | | 4.84 | % | | 5.03 | % | | 4.90 | % |
Securities | 2.20 | % | | 2.31 | % | | 2.32 | % | | 2.21 | % | | 1.90 | % |
Overnight deposits | 0.25 | % | | 0.24 | % | | 0.24 | % | | 0.24 | % | | 0.23 | % |
Total interest-earning assets | 4.26 | % | | 4.24 | % | | 4.25 | % | | 4.40 | % | | 4.22 | % |
Deposits: | | | | | | | | | |
Interest-bearing demand | 0.35 | % | | 0.37 | % | | 0.37 | % | | 0.38 | % | | 0.39 | % |
Savings and money market | 0.31 | % | | 0.30 | % | | 0.28 | % | | 0.28 | % | | 0.28 | % |
Time | 0.65 | % | | 0.69 | % | | 0.75 | % | | 0.99 | % | | 1.18 | % |
|
| | | | | | | | | | | | | | | | | | | |
FHLB advances and other borrowings | 1.18 | % | | 1.27 | % | | 1.83 | % | | 1.86 | % | | 1.55 | % |
Total interest-bearing liabilities | 0.61 | % | | 0.63 | % | | 0.70 | % | | 0.77 | % | | 0.79 | % |
Net interest spread | 3.65 | % | | 3.61 | % | | 3.55 | % | | 3.63 | % | | 3.43 | % |
Net interest margin | 3.80 | % | | 3.76 | % | | 3.73 | % | | 3.83 | % | | 3.63 | % |
Cost of deposits (including non-interest-bearing demand) | 0.33 | % | | 0.34 | % | | 0.35 | % | | 0.40 | % | | 0.44 | % |
VIEWPOINT FINANCIAL GROUP, INC.
Supplemental Information- Non-GAAP Financial Measures (unaudited)
|
| | | | | | | | | | | | | | | | | | | |
| At or For the Quarters Ended |
| September 30, 2014 | | June 30, 2014 | | March 31, 2014 | | December 31, 2013 | | September 30, 2013 |
Reconciliation of Core (non-GAAP) to GAAP Net Income and Earnings per Share: | (Dollars in thousands, except per share amounts) |
GAAP net income available to common shareholders 1 | $ | 9,215 |
| | $ | 8,721 |
| | $ | 7,592 |
| | $ | 7,147 |
| | $ | 8,096 |
|
Distributed and undistributed earnings to participating securities 1 | 97 |
| | 97 |
| | 90 |
| | 97 |
| | 116 |
|
Merger and acquisition costs | 772 |
| | 424 |
| | 110 |
| | 431 |
| | — |
|
One-time payroll and severance costs | — |
| | 234 |
| | — |
| | 137 |
| | 39 |
|
One-time (gain) loss on assets | (58 | ) | | 415 |
| | 7 |
| | (36 | ) | | (27 | ) |
Core (non-GAAP) net income | $ | 10,026 |
| | $ | 9,891 |
| | $ | 7,799 |
| | $ | 7,776 |
| | $ | 8,224 |
|
Average shares for basic earnings per share | 37,971,790 |
| | 37,873,671 |
| | 37,775,677 |
| | 37,686,866 |
| | 37,594,701 |
|
GAAP basic earnings per share | $ | 0.24 |
| | $ | 0.23 |
| | $ | 0.20 |
| | $ | 0.19 |
| | $ | 0.22 |
|
Core (non-GAAP) basic earnings per share | $ | 0.26 |
| | $ | 0.26 |
| | $ | 0.21 |
| | $ | 0.21 |
| | $ | 0.22 |
|
Average shares for diluted earnings per share | 38,203,508 |
| | 38,121,374 |
| | 38,019,519 |
| | 37,911,775 |
| | 37,774,400 |
|
GAAP diluted earnings per share | $ | 0.24 |
| | $ | 0.23 |
| | $ | 0.20 |
| | $ | 0.19 |
| | $ | 0.21 |
|
Core (non-GAAP) diluted earnings per share | $ | 0.26 |
| | $ | 0.26 |
| | $ | 0.21 |
| | $ | 0.21 |
| | $ | 0.22 |
|
| | | | | | | | | |
Calculation of Tangible Book Value per Share: | |
Total shareholders' equity | $ | 564,127 |
| | $ | 557,412 |
| | $ | 550,099 |
| | $ | 544,460 |
| | $ | 540,089 |
|
Less: Goodwill | (29,650 | ) | | (29,650 | ) | | (29,650 | ) | | (29,650 | ) | | (29,650 | ) |
Identifiable intangible assets, net | (910 | ) | | (1,005 | ) | | (1,127 | ) | | (1,239 | ) | | (1,365 | ) |
Total tangible shareholders' equity | $ | 533,567 |
| | $ | 526,757 |
| | $ | 519,322 |
| | $ | 513,571 |
| | $ | 509,074 |
|
Shares outstanding at end of period | 40,006,941 |
| | 39,995,720 |
| | 39,946,560 |
| | 39,938,816 |
| | 39,951,884 |
|
| | | | | | | | | |
Book value per share- GAAP | $ | 14.10 |
| | $ | 13.94 |
| | $ | 13.77 |
| | $ | 13.63 |
| | $ | 13.52 |
|
Tangible book value per share- Non-GAAP | $ | 13.34 |
| | $ | 13.17 |
| | $ | 13.00 |
| | $ | 12.86 |
| | $ | 12.74 |
|
| | | | | | | | | |
Calculation of Tangible Equity to Tangible Assets: | | | | | | | | | |
Total assets | $ | 3,950,524 |
| | $ | 3,951,244 |
| | $ | 3,603,588 |
| | $ | 3,525,232 |
| | $ | 3,383,607 |
|
Less: Goodwill | (29,650 | ) | | (29,650 | ) | | (29,650 | ) | | (29,650 | ) | | (29,650 | ) |
Identifiable intangible assets, net | (910 | ) | | (1,005 | ) | | (1,127 | ) | | (1,239 | ) | | (1,365 | ) |
Total tangible assets | $ | 3,919,964 |
| | $ | 3,920,589 |
| | $ | 3,572,811 |
| | $ | 3,494,343 |
| | $ | 3,352,592 |
|
| | | | | | | | | |
Equity to assets- GAAP | 14.28 | % | | 14.11 | % | | 15.27 | % | | 15.44 | % | | 15.96 | % |
Tangible equity to tangible assets- Non-GAAP | 13.61 | % | | 13.44 | % | | 14.54 | % | | 14.70 | % | | 15.18 | % |
1 Unvested share-based awards that contain nonforfeitable rights to dividends (whether paid or unpaid) are participating securities and are included in the computation of GAAP earnings per share pursuant to the two-class method described in ASC 260-10-45-60B.
FOR IMMEDIATE RELEASE
October 21, 2014
Contact: Investor Inquiries:
Casey Farrell, ViewPoint Financial Group, Inc.
972-801-5871/shareholderrelations@viewpointfinancialgroup.com
Media Inquiries:
Mary Rische, ViewPoint Bank
972-509-2020 Ex. 7331/mary.rische@viewpointbank.com
ViewPoint Financial Group, Inc. Announces Declaration of
Quarterly Cash Dividend
PLANO, Texas, October 21, 2014 -- ViewPoint Financial Group, Inc. (NASDAQ:VPFG) (the “Company”), the holding company for ViewPoint Bank, N.A., today announced a quarterly cash dividend of $0.12 per share. The cash dividend is payable on November 14, 2014, to stockholders of record as of the close of business on November 3, 2014.
About ViewPoint Financial Group, Inc.
ViewPoint Financial Group, Inc. is the holding company for ViewPoint Bank, N.A. ViewPoint Bank, N.A. operates 31 banking offices in the Dallas/Fort Worth metropolitan area, including two First National Bank of Jacksboro locations in Jack and Wise Counties. For more information, please visit www.viewpointbank.com or www.viewpointfinancialgroup.com.
When used in filings by the Company with the Securities and Exchange Commission (the “SEC”) in the Company's press releases or other public or shareholder communications, and in oral statements made with the approval of an authorized executive officer, the words or phrases “will likely result,” “are expected to,” “will continue,” “is anticipated,” “estimate,” “project,” “intends” or similar expressions are intended to identify “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements are subject to certain risks and uncertainties, including, among other things: changes in economic conditions; legislative changes; changes in policies by regulatory agencies; fluctuations in interest rates; the risks of lending and investing activities, including changes in the level and direction of loan delinquencies and write-offs and changes in estimates of the adequacy of the allowance for loan losses; the Company's ability to access cost-effective funding; fluctuations in real estate values and both residential and commercial real estate market conditions; demand for loans and deposits in the Company's market area; the industry-wide decline in mortgage production; competition; changes in management's business strategies; our ability to successfully integrate any assets, liabilities, customers, systems and management personnel we have acquired or may acquire into our operations and our ability to realize related revenue synergies and cost savings within expected time frames and any goodwill charges related thereto; and other factors set forth under Risk Factors in the Company's Form 10-K that could cause actual results to differ materially from historical earnings and those presently anticipated or projected. The factors listed above could materially affect the Company's financial performance and could cause the Company's actual results for future periods to differ materially from any opinions or statements expressed with respect to future periods in any current statements.
The Company does not undertake - and specifically declines any obligation - to publicly release the result of any revisions that may be made to any forward-looking statements to reflect events or circumstances occurring after the date of such statements.
1 NASDAQ: VPFG Third Quarter 2014 Earnings Kevin Hanigan – President and Chief Executive Officer Kari Anderson – Interim Chief Financial Officer and Chief Accounting Officer EXHIBIT 99.3
2 Safe Harbor Statement When used in this presentation, in filings by ViewPoint Financial Group, Inc. (“ViewPoint”) with the Securities and Exchange Commission (the “SEC”) in ViewPoint’s press releases or other public or shareholder communications, and in oral statements made with the approval of an authorized executive officer, the words or phrases “will likely result,” “are expected to,” “will continue,” “is anticipated,” “estimate,” “project,” “intends” or similar expressions are intended to identify “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements are subject to certain risks and uncertainties that could cause actual results to differ materially from historical earnings and those presently anticipated or projected, including, among other things, the expected cost savings, synergies and other financial benefits from the ViewPoint-LegacyTexas merger (the “Merger”) might not be realized within the expected time frames or at all and costs or difficulties relating to integration matters might be greater than expected, the requisite regulatory approvals might not be obtained or other conditions to completion of the merger set forth in the merger agreement might not be satisfied or waived, changes in economic conditions, legislative changes, changes in policies by regulatory agencies, fluctuations in interest rates, the risks of lending and investing activities, including changes in the level and direction of loan delinquencies and write-offs and changes in estimates of the adequacy of the allowance for loan losses, ViewPoint’s ability to access cost-effective funding, fluctuations in real estate values and both residential and commercial real estate market conditions, demand for loans and deposits in ViewPoint’s market area, the industry-wide decline in mortgage production, competition, changes in management’s business strategies and other factors set forth in ViewPoint’s filings with the SEC. ViewPoint does not undertake – and specifically declines any obligation – to publicly release the result of any revisions which may be made to any forward- looking statements to reflect events or circumstances after the date of such statements or to reflect the occurrence of anticipated or unanticipated events. This communication does not constitute an offer to sell or the solicitation of an offer to buy any securities or a solicitation of any vote or approval. ViewPoint has filed with the SEC a registration statement on Form S-4, which was declared effective by the SEC on April 9, 2014. The registration statement includes a proxy statement/prospectus, which was mailed in definitive form to the shareholders of LegacyTexas on April 15, 2014. INVESTORS ARE URGED TO READ THE PROXY STATEMENT/PROSPECTUS AND ANY OTHER DOCUMENTS FILED WITH THE SEC IN CONNECTION WITH THE MERGER BECAUSE THEY CONTAIN, OR WILL CONTAIN, IMPORTANT INFORMATION ABOUT LEGACYTEXAS, VIEWPOINT AND THE MERGER. Investors may obtain these documents free of charge at the SEC’s website (www.sec.gov). In addition, documents filed with the SEC by ViewPoint are available free of charge by accessing ViewPoint’s website (www.viewpointfinancialgroup.com, under “SEC Filings”) or by contacting Casey Farrell at (972) 801-5871.
3 3rd Quarter Results • Loans held for investment (excluding WPP) grew $139.6 million, or 5.9%, linked quarter; up $555.4 million, or 28.7%, year over year • Commercial loans increased $126.7 million, or 7.0%, linked quarter; up $489.0 million, or 34.0%, year over year • WPP ending balances decreased by $32.9 million, or 4.3%, from Q2 2014, while average balances increased $73.2 million, or 12.8%, linked quarter Strong Loan Growth Third Quarter Earnings • Quarterly net income totaled $9.3 million, an increase of 5.6% linked quarter; up 13.4% year over year • Q3 2014 GAAP EPS of $0.24, up $0.01 linked quarter and up $0.02 year over year • Q3 2014 core EPS of $0.26, unchanged linked quarter and up $0.04 year over year • Q3 2014 NIM of 3.80%, up four basis points linked quarter, and up 17 basis points year over year • Merger will result in one of the largest independent banks in Texas, with 51 branches and pro forma assets of over $5 billion • Merger completes transition to commercially oriented community bank • Leverages excess capital in a financially attractive transaction • Approved by Legacy shareholders on May 19, 2014 Credit Quality and Capital Levels • Non-performing assets of $24.5 million, or 0.62% of total assets • Asset quality metrics continue to compare favorably to industry • TCE to Tangible Assets of 13.61% (pre-merger) Source: Company Documents LegacyTexas Group, Inc. Merger
4 LegacyTexas Group, Inc. Merger • Legacy shareholders approved merger on May 19th • Regulatory approval pending, merger agreement extended to December 31st • Teams diligently working towards integration • Both companies continue to have strong positive momentum Pro forma total assets ($ in millions) Pro forma total deposits ($ in millions) VPFG stand-alone LegacyTexas Pro forma VPFG stand-alone LegacyTexas Pro forma Source: Company documents, data as of September 30, 2014
5 ViewPoint and Legacy Combined Branch Map 1 Includes only banks and thrifts headquartered in the Dallas-Fort Worth-Arlington, TX MSA 2 Based on deposit market share of banks and thrifts headquartered in Texas Source: Company Documents, FDIC market share data as of June 30, 2014 Dallas Fort Worth MSA Franchise Texas Franchise LegacyTexas (20 branches total) ViewPoint (31 branches total) #3 deposit market share among Texas based independent banks in DFW1 #1 market share in affluent Collin County among independent banks2 #3 overall deposit market share in Collin County among all banks
6 Source: Company Documents; Note: Total shareholder return through September 30, 2014 ¹ Does not include Warehouse Purchase Program loans 2 KBW Regional Bank Index (KRX) is an index of 50 regional banks representing regional banks or thrifts listed on U.S. stock markets 3 KBW Bank Index is an index of 24 companies representing leading national money centers and regional banks or thrifts Total shareholder return since 12/08/2011 77% commercial portfolio1 Up from 29% in 2007 Commercial Bank Transformation The pending merger with LegacyTexas is the final step in our transformation into a commercial bank Strategic Action Leading to Meaningful Results Merger with LegacyTexas Group, Inc. 60% interest revenue is commercial Up from 16% in 2007 28% C&I of loans HFI1 Up from 1% in 2007 264bp reduction in deposit cost compared to 2007 33bps MRQ KBW Regional Bank Index2 S&P 500 KBW Bank Index3
7 Interest Revenue Transformation (1) Includes LegacyTexas interest income at September 30, 2014 Source: Company Documents, consumer loans includes consumer RE Continued diversification, commercial now 60% of earning asset revenue (up 288% from 2008)
8 Comparison of Commercial Loans vs Securities Source: Company Documents Commercial loan growth outpaces the decline in securities portfolio
9 Strong Commercial Loan Growth C&I Lending Growth ($ in millions) Source: Company Documents CRE Lending Growth ($ in millions) C&I and CRE increased a combined 7.0% (linked quarter) $439 $544 $611 $696 $391
Low Cost, Diversified Deposit Base 10 Source: Company Documents Total deposits Cost of deposits • Non-interest-bearing demand deposits up $82.6 million from September 30, 2013 • Savings and money market deposits up $161.6 million from September 30, 2013
11 Source: : Company Documents 1 See Appendix for reconciliation of core (non-GAAP) to GAAP net income 2 Calculated by dividing total non-interest expense by net interest income plus non-interest income, excluding gain (loss) on assets, impairment of goodwill, amortization of intangible assets, gains (losses) from securities transactions, merger and acquisition costs and other non-recurring items. Efficiency Ratio 2 Net Interest Margin Net Interest Income (In Millions) Core ROAA1 CAGR: 19% Profitability
12 Strong Credit Quality Net Charge Offs/ Average Loans (1) NPAs / Loans + OREO (1) (1) Loans represent VPFG loans held for investment excluding Warehouse Purchase Program loans (2) SNL Southwest U.S. Bank Index includes all major exchange (NYSE, NYSE MKT, NASDAQ) banks in SNL’s coverage universe headquartered in CO, LA, NM, OK, TX, and UT Source: Company documents; SNL Financial NPA/ Equity Index
13 Looking Ahead * Successful integration of LegacyTexas and re-branding of the pro- forma franchise * Focus on growth – organically and through selective acquisitions * Diversify income sources * Prudent and focused expense management * Maintain strong asset quality * Strategic capital deployment
14 Questions?
15 Appendix The subsequent tables present non-GAAP reconciliations of the following calculations: Tangible book value per share to tangible assets ratio Tangible book value per share Core (non-GAAP) net income and earnings per share
16 Appendix Tangible Equity to Tangible Assets and Tangible Book Value per Share at September 30, 2014 (Dollar amounts in thousands) Total GAAP equity $ 564,127 Less: goodwill (29,650 ) Less: identifiable intangible assets, net (910 ) Total tangible equity $ 533,567 Total GAAP assets $ 3,950,524 Less: goodwill (29,650 ) Less: identifiable intangible assets, net (910 ) Total tangible assets $ 3,919,964 GAAP equity to total assets 14.28 % Tangible equity to tangible assets 13.61 % Shares outstanding at September 30, 2014 40,006,941 Tangible book value per share $ 13.34
17 Appendix Reconciliation of Core (non-GAAP) to GAAP Net Income and EPS (Dollar amounts in thousands except per share data) Three Months Ended 9/30/2014 6/30/2014 3/31/2014 12/31/2013 9/30/2013 6/30/2013 3/31/2013 12/31/2012 9/30/2012 GAAP net income available to common shareholders $ 9,215 $ 8,721 $ 7,592 $ 7,147 $ 8,096 $ 8,058 $ 7,994 $ 10,316 $ 11,280 Distributed and undistributed earnings to participating securities 97 97 90 97 116 116 64 45 36 Merger and acquisition costs 772 424 110 431 — — — — 158 Costs relating to sale of VPM — — — — — — — — (4 ) One-time payroll and severance costs — 234 — 137 39 260 — — 238 One-time (gain) loss on assets (58 ) 415 7 (36 ) (27 ) — (511 ) (252 ) (70 ) (Gain) loss on sale of AFS securities — — — — — — 115 — (584 ) Core (non-GAAP) net income $ 10,026 $ 9,891 $ 7,799 $ 7,776 $ 8,224 $ 8,434 $ 7,662 $ 10,109 $ 11,054 Basic earnings per share: Average shares for basic earnings per share 37,971,790 37,873,671 37,775,677 37,686,866 37,594,701 37,545,050 37,529,793 37,460,539 37,362,535 GAAP basic earnings per share $0.24 $0.23 $0.20 $0.19 $0.22 $0.21 $0.21 $0.28 $0.30 Core (non-GAAP) basic earnings per share $0.26 $0.26 $0.21 $0.21 $0.22 $0.22 $0.20 $0.27 $0.30 Diluted earnings per share: Average shares for diluted earnings per share 38,203,508 38,121,374 38,019,519 37,911,775 37,774,400 37,692,513 37,681,402 37,592,618 37,466,031 GAAP diluted earnings per share $0.24 $0.23 $0.20 $0.19 $0.21 $0.21 $0.21 $0.27 $0.30 Core (non-GAAP) diluted earnings per share $0.26 $0.26 $0.21 $0.21 $0.22 $0.22 $0.20 $0.27 $0.30
18 Appendix Reconciliation of Core (non-GAAP) to GAAP Net Income and EPS (Dollar amounts in thousands except per share data) Year Ended December 31, 2013 2012 2011 2010 2009 GAAP net income available to common shareholders $ 31,294 $ 35,135 $ 26,205 $ 17,635 $ 2,631 Distributed and undistributed earnings to participating securities 394 106 123 164 39 Merger and acquisition costs 431 2,683 306 - - Costs relating to sale of VPM - 84 - - - One-time payroll and severance costs 436 777 - - - One-time (gain) loss on assets (574 ) (1,353 ) (497 ) 135 526 Goodwill impairment - 532 176 - - (Gain) loss on sale of AFS securities 115 (659 ) (4,074 ) - (1,569 ) Impairment of collateralized debt obligations (all credit) - - - - 8,082 Core (non-GAAP) net income $ 32,096 $ 37,305 $ 22,239 $ 17,934 $ 9,709 Basic earnings per share: Average shares for basic earnings per share 37,589,548 35,879,704 32,219,841 30,128,985 27,881,941 GAAP basic earnings per share $0.83 $0.98 $0.81 $0.59 $0.09 Core (non-GAAP) basic earnings per share $0.85 $1.04 $0.69 $0.60 $0.35 Diluted earnings per share: Average shares for diluted earnings per share 37,744,786 35,998,345 32,283,107 30,131,960 27,882,874 GAAP diluted earnings per share $0.83 $0.98 $0.81 $0.59 $0.09 Core (non-GAAP) diluted earnings per share $0.85 $1.04 $0.69 $0.60 $0.35
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